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Atlas Elektronik UK announces the acquisition of the Underwater Systems business

Atlas Elektronik UK ("Atlas") is delighted to announce the acquisition of the Underwater Systems ("UWS") business of the QinetiQ Group plc.

UWS is a market leader in underwater defence and security related systems including sonar, open architecture sonar and combat management systems, underwater communication, mine warfare, torpedo homing systems, acoustic counter measures, submarine signatures, maritime security and control of unmanned maritime vehicles. It is a world-class business with a strategic significance, providing capability and support to the UK's Ministry of Defence ("MoD"), the Royal Navy and other defence departments and corporate customers internationally, especially in submarine programmes. The UWS product portfolio will build on Atlas Elektronik's existing capabilities, presenting an outstanding opportunity for Atlas Elektronik to enhance its know-how and offering in hydro acoustics, the core competency of the Company.

As is normal with such transactions in the UK defence market, the agreement is subject to regulatory approval and is expected to complete this summer. It represents a major investment in the underwater warfare systems centre of excellence at Winfrith in Dorset, and will secure the future of the 220 high technology personnel based there. It will build on Atlas Elektronik UK's existing presence in Newport, South Wales. Atlas Elektronik UK is already a significant contractor to the UK MoD and Royal Navy.

Atlas Elektronik GmbH, the parent company of Atlas Elektronik UK, plans to integrate UWS into Atlas Elektronik UK. The existing project management methods, reporting structures and IT infrastructure are, to a large extent, the same as those applied by Atlas Elektronik to run its existing projects and a smooth integration is expected.

Anthem Corporate Finance acted as sole financial adviser to Atlas with respect to this acquisition.

Dieter Rottsieper and Kai Horten, Managing Directors of Atlas Elektronik GmbH, commented: "It is an exciting time for Atlas. The acquisition of the UWS business represents a very significant step forward in the development of our UK operations, increasing our presence in a key naval market, and cementing our position as a first class provider of hydro acoustic and sonar technology internationally. We are committed to enhancing and building our support and services to the UK Ministry of Defence and UWS' other key customers internationally."

Bob Waters, Managing Director of Atlas Elektronik UK added: "This is a strategic acquisition of highly skilled people and know-how. We have been an established supplier to the MoD and international customers for many years and this will broaden our capability and strengthen our UK presence."